U.S. Treasury Secretary, Timothy Geithner, was president of the New York Federal Reserve Bank at the same time Lehman-Brothers was using financial engineering (accounting gimmicks) to shuffle $50B in toxic assets off its books, before collapsing in September 2008. There is little doubt Geithner had to know, concealed the facts and failed to take appropriate action.

New York Federal Reserve Bank

No coincidence that the New York Times and Huffington Post fail to cite the Fed’s, and Tim Geithner’s, lack of action made clear from the 2200 page report.

Naked Capitalism takes a look at a new examiner’s report into how and why Lehman failed, showing Tim Geithner is likely complicit in cover-up:

It also emerges that the NY Fed, and thus Timothy Geithner, were at a minimum massively derelict in the performance of their duties, and may well be culpable in aiding and abetting Lehman in accounting fraud and Sarbox violations.

We need to demand an immediate release of the emails, phone records, and meeting notes from the NY Fed and key Lehman principals regarding the NY Fed’s review of Lehman’s solvency. If, as things appear now, Lehman was allowed by the Fed’s inaction to remain in business, when the Fed should have insisted on a wind-down (and the failed Barclay’s said this was not infeasible: even an orderly bankruptcy would have been preferred….) the NY Fed at a minimum helped perpetuate a fraud on investors and counterparties.

Yves Smith at Naked Capitalism updated his post at 3 AM this morning after reading pertinent sections of the report.

Every page is stunning…the nonsense is mile high. Lehman had been doing this sort of things since 2001. No US law firm would give them cover via an opinion letter for their phony repo accounting…

So, let’s get busy demanding release of items that will likely incriminate Tim Geithner, and the Federal Reserve.